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I have a Roth IRA brokerage account with an individual stock that has lost most of its value. Can this stock be sold and the loss used to create a loss for tax purposes outside the Roth IRA account? Or do losses in Roth IRA's not count outside the IRA meaning there would be no reason to sell the worthless stock by paying a commission? Thanks for your advice.
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I have a Roth IRA brokerage account with an individual stock that has lost most of its value. Can this stock be sold and the loss used to create a loss for tax purposes outside the Roth IRA account?

No

Or do losses in Roth IRA's not count outside the IRA
meaning there would be no reason to sell the worthless stock by paying a commission?

This is correct except that you might just want to get rid of your loser stock and buy something that might appreciate.
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I also have a Roth IRA account with a stock that lost much, but not all, of its value. Can this Roth be converted to a regular IRA- to be used for a tax deduction? The $2,000 Roth has a value of about $500
now. Would the conversion give me a tax deductible IRA
deduction of 2,000 or 500? Or, might I be allowed to close this IRA and pay the penalty and start another IRA for the year 2000? Thank you.
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I also have a Roth IRA account with a stock that lost much, but not all, of its value. Can this Roth be converted to a regular IRA- to be used for a tax deduction? The $2,000 Roth has a value of about $500 now. Would the conversion give me a tax deductible IRA
deduction of 2,000 or 500? Or, might I be allowed to close this IRA and pay the penalty and start another IRA for the year 2000?


Way not enough information.

1. What year was the contribution for? If not year 2000, there's no way to change it. If it was for 2000, more questions.

2. Are you or your spouse covered by a retirement plan at work. If so, who and what is your approximate AGI?

The above questions relate to an IRA deduction. If you liquidate your entire Roth IRA and receive less than your basis, you have a miscellaneous deduction on Schedule A, subject to the 2% of AGI exclusion. You also are not exactly on your way to retirement security.

IRAs are not designed as tools for current tax management, and they really don't work very well when used for that purpose. IMO you'd be better off selling investments you no longer find attractive and buying ones you do, all under the IRA umbrella.

TMF ExRO
Phil Marti
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